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Monday, 13 February 2012
Page: 835


Mr VAN MANEN (Forde) (13:38): Once again, I stand in this House to speak on a bill that is a direct result of another broken Labor promise—the Fairer Private Health Insurance Incentives Bill 2011 and related bills.

I would like to start by reading a letter sent to the honourable Dr Michael Armitage, the chief executive of the Australian Health Insurance Association, dated 20 November 2007 and signed by the then leader of the Labor Party, Kevin Rudd:

Thankyou for your letter of 29 October 2007 seeking clarification on Federal Labor's policy regarding private health insurance.

Both my Shadow Minister for Health, Nicola Roxon, and I have made clear on many occasions … that Federal Labor is committed to retaining the existing private health insurance rebates, including the 30 per cent general rebate and the 35 and 40 per cent rebates for older Australians.

Federal Labor will also maintain Lifetime Health Cover and the Medicare Levy Surcharge.

Labor will maintain the existing framework for regulating private health insurance, including the process for approval of premium increases …

I understand Nicola Roxon's office has also confirmed with you that Federal Labor has no plans to require private health insurance funds to make equivalent payments to public hospitals for patients who elect to be treated as private patients.

I think this clearly bears out my opening comments that this is another broken Labor promise. Contrary to that letter, we stand here today witnessing another betrayal of the Australian people. This is a government that continues to go back on its word, continues to break promises and continues to implement bad policy aimed at increasing the cost of living for every Australian.

Proposed within this bill is a provision to implement three new income tiers. It is interesting to look at the part of the argument that says that the poor are subsidising the rich and there is inequity in the system. Let us have a look at some real figures. If you are on an income of $30,000 per year, you are paying approximately $4,000 per year in tax and Medicare levy. If you double that income to $60,000 per year, your tax and Medicare levy payments go up to about $12,500 per year—that is three times more. If you triple your income to $90,000 per year, your tax and Medicare levy surcharges grow by five times. When we look at those figures it is quite clear that, in direct contrast to statements made by colleagues opposite, as you earn more income, you pay more tax and you pay a higher Medicare levy: you are already contributing significantly to the economic welfare of this country. People earning a lower level of income are certainly not subsidising those earning higher levels of income.

The tiers will determine the amount of rebate that families will be entitled to. We are facing increasing costs of living and higher taxes through the carbon tax coming in from 1 July and these add to the growing list of pressures that people are facing daily. That is the big concern. As was pointed out earlier, previous increases or changes may not have led to a large exodus from private health insurance. But we are in a different economic environment today. The key findings of the Deloitte report were that 1.6 million consumers would walk away from private health insurance and a further 4.3 million would downgrade their cover.

Even if those figures are not all realised, there is going to be a significant additional cost to our public health system at a time when it is already struggling to maintain pace with the requirements on it. In addition, the Australian Health Industry Association has conducted some phone polling. Of those people polled, around 11 per cent said they would drop their hospital cover and a further 24 per cent would downgrade their policies. More than half of those surveyed said they would drop their ancillary or general cover. This is very concerning at a time when we are looking to rein in the costs of our public hospital system and where we are looking for that system to be able to meet the pressures that are presently on it. This mass exodus from private health insurance will only add to that strain.

You only have to look at today's Gold Coast Bulletin to highlight this argument. There is an article talking about a 67-year-old lady who could not feel her fingers and waited for more than four years to see a neurosurgeon because she was classified as a semi-urgent patient. This woman is among 2,000 Gold Coasters currently waiting to see a neurosurgeon. In addition, neurosurgery and ear, nose and throat surgeries are all reported as having some of the highest waiting periods. Another article in the Courier Mail referred to the fact that parents of children with ear, nose and throat problems are being told to consider paying for private treatment despite living in one of the most disadvantaged areas of South East Queensland.